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1. Company Snapshot

1.a. Company Description

Sempra operates as an energy-services holding company in the United States and internationally.The company's San Diego Gas & Electric Company segment provides electric services; and supplies natural gas.It offers electric services to approximately 3.6 million population and natural gas services to approximately 3.3 million population that covers 4,100 square miles.


Its Southern California Gas Company segment owns and operates a natural gas distribution, transmission, and storage system that supplies natural gas to a population of approximately 22 million covering an area of 24,000 square miles.The company's Sempra Texas Utilities segment engages in the regulated transmission and distribution of electricity serving 3.8 million homes and businesses, and operation of 140,000 miles of transmission and distribution lines.Its transmission system includes 18,249 circuit miles of transmission lines, a total of 1,174 transmission and distribution substations, and interconnection to 130 third-party generation facilities totaling 45,403 megawatts.


The company was formerly known as Sempra Energy and changed its name to Sempra in July 2021.Sempra was founded in 1998 and is headquartered in San Diego, California.

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1.b. Last Insights on SRE

Sempra's recent performance was driven by its strong Q1 2025 earnings, which beat estimates by 19%. The company's revenue increased 4.5% year-over-year, driven by growth in its regulated utilities segment. Sempra's management has also issued a forecast of 7% to 9% annual adjusted EPS growth through 2029, indicating a positive outlook for the company. Additionally, Sempra has a 15-year dividend growth streak, with a current dividend yield of 3.5%. The company's solid dividend and growth prospects make it an attractive investment opportunity. Sempra's infrastructure segment is also expected to benefit from planned investments and LNG projects, further driving growth.

1.c. Company Highlights

2. Sempra's Q3 2025 Earnings: A Strong Performance with Growth Momentum

Sempra's third-quarter 2025 adjusted EPS came in at $1.11, surpassing analyst estimates of $0.911, representing a 25% increase from the prior period's $0.89. The company's GAAP earnings were $0.12 per share, impacted by a $514 million tax expense related to the Sempra Infrastructure Partners transaction. On an adjusted basis, earnings were $728 million or $1.11 per share. Revenue growth is expected to continue, with analysts estimating a 4.6% increase for next year.

Publication Date: Nov -06

📋 Highlights
  • Adjusted EPS Growth:: Q3 2025 adjusted EPS increased to $1.11 from $0.89 in the prior period, affirming full-year 2025 guidance of $4.30–$4.70 and 2026 guidance of $4.80–$5.30.
  • Capital Investment Progress:: $9 billion invested through Q3 2025, on track to meet the $13 billion year-end target, with $55–$60 billion in capital opportunities through 2030 due to Permian plan acceleration.
  • Sempra Infrastructure Partners Sale:: $10 billion agreement for a 45% stake, expected to add $0.20 EPS accretion over five years and deconsolidate debt by mid-2026.
  • Texas Transmission Expansion:: $32–$35 billion estimated investment in Texas 765kV projects by 2030, with Oncor responsible for over 50% of the total.
  • Growth in Load Capacity:: Oncor aims to double peak load to 62 GW by 2030, with 19 GW already secured under the interim FEA process and 210 GW of active data center requests.

Strategic Positioning and Growth Initiatives

Sempra is focused on lower-risk, higher-value transmission and distribution investments, growing its position in large economic markets, and shifting capital allocation to fund US utilities, particularly in Texas. The company announced a sales agreement for a 45% stake in Sempra Infrastructure Partners for $10 billion, expected to improve the company's business growth profile and unlock reinvestment capital. As Jeffery Martin stated, the transaction is expected to add $0.20 to EPS accretion over five years.

Operational Progress and Regulatory Updates

The company is making progress on its value creation initiatives, including improving community safety and driving operational excellence. Sempra Infrastructure's LNG business is making notable headway, with Port Arthur LNG Phase 1 expected to reach COD in 2027. Oncor's base rate review is progressing, with the company expecting a constructive rate case outcome, which will drive significant investment in Sempra Texas.

Valuation and Growth Prospects

With a P/E Ratio of 22.21 and an EV/EBITDA of 16.44, the market is pricing in a certain level of growth for Sempra. The company's ROE is 8.73%, indicating a relatively healthy return on equity. The Net Debt / EBITDA ratio is 6.4, suggesting a manageable debt burden. Sempra's growth prospects are supported by its strategic positioning, operational progress, and regulatory updates, making it an attractive investment opportunity.

Outlook and Conclusion

Sempra is confident in its ability to deliver on its growth plans, with a strong supply chain and a focus on improving public policy to support public safety. The company's 2025 guidance is affirmed, and it is tracking ahead of its financial plan. With a 7% to 9% growth rate and improved capital efficiency at Oncor, Sempra is well-positioned for long-term success. As Julien Dumoulin-Smith noted, the company's growth prospects are supported by its improved capital efficiency and longer growth runway at Sempra Infrastructure.

3. NewsRoom

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SDG&E® Named Most Reliable Utility in the West for 20th Straight Year

Dec -02

Source: prnewswire.com

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Advisors Asset Management Inc. Raises Stock Position in Sempra Energy $SRE

Dec -01

Source: defenseworld.net

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Sempra Energy Gains From LNG Expansion and Major Investments

Nov -28

Source: zacks.com

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Rep. Lisa C. McClain Sells Sempra Energy (NYSE:SRE) Shares

Nov -27

Source: defenseworld.net

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Sempra recognized among 'America's Best Employers for Company Culture' by Forbes

Nov -24

Source: prnewswire.com

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FERC grants five-year extension to Sempra's Cameron LNG project in Louisiana

Nov -24

Source: reuters.com

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Sempra Energy $SRE Shares Purchased by Bank Julius Baer & Co. Ltd Zurich

Nov -21

Source: defenseworld.net

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Sempra Energy (NYSE:SRE) Given Average Rating of “Moderate Buy” by Brokerages

Nov -19

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (3.40%)

6. Segments

Sempra California

Expected Growth: 3.2%

Sempra California's 3.2% growth is driven by increased demand for renewable energy, infrastructure investments, and rate base growth. The company's focus on grid modernization, energy storage, and electric vehicle infrastructure also contribute to its growth. Additionally, Sempra California's service territory growth and constructive regulatory environment support its increasing earnings.

Sempra Infrastructure

Expected Growth: 4.5%

Sempra Infrastructure's 4.5% growth is driven by increasing demand for renewable energy, expansion of liquefied natural gas (LNG) exports, and investments in energy storage and grid modernization. The company's strategic focus on sustainable infrastructure and growing presence in key markets contribute to its growth momentum.

Intersegment

Expected Growth: 0.0%

Intersegment growth at 0.0% for Sempra suggests stable, possibly mature market conditions. Fundamental drivers include consistent demand, limited new entrants, and efficient operational management. The lack of growth may indicate a focus on profitability over expansion, or market saturation.

7. Detailed Products

San Diego Gas & Electric (SDG&E)

Provides electric and natural gas services to the San Diego and southern Orange counties in California

Southern California Gas Company (SoCalGas)

Provides natural gas services to central and southern California

Oncor Electric Delivery Company

Provides electric transmission and distribution services to the Dallas-Fort Worth area in Texas

IEnova

Develops, builds, and operates energy infrastructure in Mexico

Sempra LNG & Midstream

Develops and operates liquefied natural gas (LNG) terminals and natural gas pipelines

Sempra Renewables

Develops and operates renewable energy projects, including solar and wind farms

8. Sempra's Porter Forces

Forces Ranking

Threat Of Substitutes

Sempra's natural gas and electricity businesses face moderate threats from substitutes, such as renewable energy sources and energy-efficient technologies.

Bargaining Power Of Customers

Sempra's customers, including residential, commercial, and industrial users, have limited bargaining power due to the company's diversified customer base and lack of dependence on a single customer.

Bargaining Power Of Suppliers

Sempra's suppliers, including natural gas and electricity providers, have moderate bargaining power due to the company's dependence on a few large suppliers and the availability of alternative suppliers.

Threat Of New Entrants

The threat of new entrants in Sempra's markets is low due to high barriers to entry, including significant capital requirements and regulatory hurdles.

Intensity Of Rivalry

The intensity of rivalry in Sempra's markets is high due to the presence of several large competitors, including utilities and energy companies, which leads to competitive pricing and marketing strategies.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 51.00%
Debt Cost 6.62%
Equity Weight 49.00%
Equity Cost 7.44%
WACC 7.02%
Leverage 104.09%

11. Quality Control: Sempra passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
American Electric Power

A-Score: 6.9/10

Value: 5.7

Growth: 4.6

Quality: 6.8

Yield: 7.0

Momentum: 7.5

Volatility: 10.0

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Otter Tail

A-Score: 6.6/10

Value: 5.3

Growth: 7.0

Quality: 6.5

Yield: 6.0

Momentum: 6.0

Volatility: 8.7

1-Year Total Return ->

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Edison

A-Score: 6.4/10

Value: 8.3

Growth: 5.3

Quality: 7.5

Yield: 9.0

Momentum: 1.0

Volatility: 7.3

1-Year Total Return ->

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Duke Energy

A-Score: 6.4/10

Value: 5.5

Growth: 4.7

Quality: 4.6

Yield: 7.0

Momentum: 6.5

Volatility: 10.0

1-Year Total Return ->

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ALLETE

A-Score: 6.4/10

Value: 5.9

Growth: 4.0

Quality: 4.3

Yield: 8.0

Momentum: 6.0

Volatility: 10.0

1-Year Total Return ->

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Sempra

A-Score: 5.8/10

Value: 4.8

Growth: 4.4

Quality: 4.5

Yield: 6.0

Momentum: 6.5

Volatility: 8.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

90.07$

Current Price

90.07$

Potential

-0.00%

Expected Cash-Flows